Court tosses Icahn appeal

Legal options vs. Lionsgate exhausted

A Canadian court Tuesday dismissed an appeal from activist shareholder Carl Icahn pertaining to an earlier lawsuit he filed against Lionsgate, exhausting his months-long legal attempts to challenge the management of the mini-major.

Decision by the Court of Appeal for British Columbia follows the dismissal last November by the British Columbia Supreme Court of a lawsuit in which Icahn asks that a debt-for-equity swap Lionsgate executed last summer by rescinded. The move diluted Icahn’s position in the company at a time when he was aggressively looking to take control of Lionsgate, which is headquartered in Vancouver.

In July, Lionsgate said its second largest shareholder, Mark Rachesky’s MHR Fund Management, had swapped $100 million in debt for stock that reduced Icahn’s position in Lionsgate to 33% from 38%. Following the November ruling Icahn appealed. In March, a New York judge dismissed a similar lawsuit brought by Icahn. He has not appealed.

And in December, a New York judge ruled that Rachesky could vote the shares he obtained in the debt-for-equity swap in a proxy vote at Lionsgate’s annual meeting. Shortly after that, Icahn announced he would abandon his proxy fight, in which he was seeking to put his own slate of five directors on the Lionsgate board.

Icahn is still the largest shareholder with a 33% stake.

On Monday, in a regulatory filing, Lionsgate said it spent $23 million during its fiscal year ended March 31 defending against Icahn.